[Posted 7:00 AM ET]
One thing about going to Ireland, aside from playing the
awesome golf courses, is you can have some free-flowing
discussions in the pubs and this last trip of mine was no
exception.
Oh, I mean to tell you, I had some late, late night chats on all
things political, and, as you’d expect, the pacifist Irish don’t
quite understand what the U.S. is doing in preparing for war
against Saddam. Of course these are the same people who still
adore Bill Clinton, because he paid more attention to them than
Osama, but I’ve long forgiven the Irish for this, though I’ll never
forgive Clinton.
And so it was that while over there this past week, I saw enough
news concerning the ongoing debate back in America to know
that what was once a healthy one has clearly deteriorated. Some
of it is simply political theatrics. I can’t get worked up over
every single statement that Tom Daschle makes, for example,
and, to be fair, you’ve known of my disdain for Bush puppeteer
Karl Rove, because, let’s face it, both sides don’t always act in
the nation’s best interests. As you get older, though, at least in
my case, you roll with the punches more often than not and chalk
it all up to the American experience, still the best on earth.
But then there is Al Gore. What a freakin’ conniving, slimy,
smarmy, totally despicable figure he is. There was a time,
believe it or not, when he was an adequate senator, but then he
found Billy Boy and the rest is history.
Columnist Michael Kelly summed up Gore’s anti-Bush diatribe
as “dishonest, cheap, low…breathtakingly hypocritical.” And
Gore flat out lied when he said the President had squandered the
war on terror by shifting the focus to Iraq. Folks, we have made
tremendous strides in this fight, and don’t believe anyone who
tells you otherwise. Just on Friday, for example, the government
in Malaysia arrested 30 suspected terrorists with ties to al-Qaeda,
while the more we learn about how our friends in Singapore and
how they foiled what would have been an utter catastrophe, the
more admiration I have for this good country.
No one for a second, however, believes we are even minutely
close to winning the struggle (we won’t win it in my lifetime,
that’s for sure), but Gore was so off base in his criticism,
particularly for a man who sat at the right hand of a leader who
could have made a difference, and didn’t, that upon dissection,
his remarks border on treason. Thankfully, I am confident
the real Democrats will see the light and eject this plastic man
into space, where he can flail away with the space rocks. In my
mind, Al Gore is officially irrelevant. I hope most others come
to the same conclusion.
So back to the real issue at hand, Iraq. British Prime Minister
Tony Blair released his dossier on Saddam’s bio/chemical
weapons machine and issued the scary warning that within 45
minutes Saddam could load and launch Armageddon against a
concentrated population, not that any intelligent being needed
reminding of this, but the world is full of idiots who require
constant schooling.
Meanwhile, as the Bush Administration gets its act together in
Congress (it never should have deteriorated in the fashion it did,
but mid-term elections have a way of doing that), Colin Powell
and team still have their work cut out for them in the UN
Security Council. Yes, the U.S. and Britain could act without
UN approval, but the cleanup and aftermath of the operation
require broader support.
Russia has been petulant this week, though from a purely
political standpoint, while standing back as an observer, I
understand fully what they are doing. How many times have I
mentioned, going back to at least 2000, that Iraq owes the
Russians $8 billion? In Moscow, that’s big money. Just look at
how the Russian Army has been humiliated and ripped to shreds
recently by a bunch of rag tag, Taliban-type fighters in
Chechnya. This is power politics at its purest and Putin wants
the very guarantees I keep writing should have been wrapped up
months ago. That is a simple failure of the White House. But
keep the faith. Vladimir Putin knows his future resides with the
U.S. and the West. Otherwise it’s financial suicide for his
countrymen. As for France, they’ll follow Russia. We can’t
afford to blow this one.
During my week in Ireland, my 3 friends from PIMCO and I
often talked about the situation we are faced with today. We
were all in agreement that another, far bigger attack on the U.S.
looms. But at the same time, I stand by my past comments that
what the civilized world is really waiting for is a display of U.S.
resolve and commitment. Once we knock off Saddam and, just
as importantly, stay for the predictably chaotic nation-building,
the rewards could be great. I’m well aware of the risks of ethnic
strife in Iraq and elsewhere, but I see light at the end of the
tunnel.
The American people just have to be convinced of the need to
see it through to the end, of the need to sacrifice (which will
come shortly in various forms), and, thankfully, we have a
President who gets it. It’s too bad, however, that the political
crap often seems to stand in the way.
Wall Street / The Economy
Let’s start at the top with the Federal Reserve, which opted to
once again hold the line on interest rates (though with two
dissenters on the policy board who sought to see rates lowered)
as the formal statement noted that “considerable uncertainty
persists about the extent and timing of the expected pickup in
production and employment owing in part to the emergence of
heightened geopolitical risks.”
With logic like this, you’d think they’d all have voted to lower
rates (which still wouldn’t have helped any), but there seems to
be the feeling the Fed is waiting to see what happens in the
markets once the shooting starts in Iraq. If the markets collapse
at that point (if they haven’t done so beforehand), they’ll attempt
one last time to ride to the rescue. Why look, up on the horizon,
it’s the Federal Reserve to save the day! My heroes…
Meanwhile, one of our favorites here at StocksandNews, Morgan
Stanley’s Stephen Roach, opined in the New York Times:
“There is good reason to believe that the property and consumer
bubbles will burst in the not so distant future…(which could
foretell) a series of recessionary relapses during the next several
years.”
Roach adds that it is the “culture of excess (that has been)
driving the U.S. economy.”
Ah, the man speaks the truth, yet I suppose you want more.
First, what’s positive these days? Well, I guess you could stretch
and say that GM’s forecast for 2003 of sales similar to 2002 is a
good sign, even if it doesn’t necessarily translate into profits.
And I guess you could look at new home sales and say they
continue to grow, even though other housing figures are clearly
slowing.
But that’s about it. So what’s negative?
–America’s household balance sheets, despite the housing sheen
and savings from refinancings, are deteriorating at a rapid clip.
Household net worth fell 3.4% in the second quarter (and
undoubtedly will fall further in the third), while household debt
rose 9%.
–Employment is still punk (even if jobless claims improved for
the first time in ages this week), with SBC Communications
announcing further massive layoffs to the tune of 11,000. SBC
also announced it was slashing capital spending from a projected
$8 billion in 2002 to about $5 billion in 2003. That’s big news,
especially if you work for a telecom supplier like Lucent or
Nortel, both of which saw their shares plummet to the level of a
can of beer.
–On the retail front, Wal-Mart, instead of consistently offering
upbeat reports on its sales, as it has for years now, has clearly
reversed trend and the stock is beginning to crack. If you are
relying on the American consumer to keep saving the day, you
must take note of this.
–G.E. warned that the economic environment is “much tougher
than planned.” Just put Wal-Mart and G.E. together and you
probably don’t need to know much more to get a handle on
things.
–Corporate America, as we said would happen at the beginning
of this year, has been slashing earnings projections for the third
quarter from an increase of 16.6% on July 1st to about 7% today.
Fourth quarter estimates are also plummeting.
–Then there is the ongoing issue of derivatives and the exposure
on some balance sheets. This week, EDS’s announcement that it
took a hit on its own share price (by screwing around with put
options…i.e., derivatives) is but the tip of the iceberg. One
simple truth bears repeating, that being the fact that the
investment community has been hoodwinked by the power of
derivatives, and some never seem to learn until it’s too late.
As for yours truly, I await the day when we have a massive
accident at the likes of J.P. Morgan Chase. You think these guys
are really rocket scientists and understand how all their
instruments operate in various, chaotic scenarios? Do you think
they understand that the other side of some of these trades may
not be able to meet their end of the bargain? It’s coming, folks.
Fasten your seatbelt. Whether it’s JPM, Citigroup, Merrill
Lynch, Fannie Mae or some other player, something huge is
lurking out there.
But, you say, Alan Greenspan is always touting the beauty of
derivatives, so they can’t all be bad. Alan Greenspan? You
mean he’s still around? I thought I already pinned a nametag on
his windbreaker and sent him to the dog track. What? You
mean while I was boozing it up and hacking my way through
Ireland, he was being knighted by the Queen? Now I’m really
depressed.
–But wait, there’s more. Of course when war hits, the American
consumer isn’t likely to shop with both fists, while the budget
deficit explodes (as it should if we are to get the job done right).
Yet there is this other gnawing issue that not only won’t go
away, it will only get bigger.
Corporate governance…corporate dirtballs, that is. I came home
on Wednesday and sitting there in the mail was the latest issue of
NYSE magazine, with Merrill Lynch’s David Komansky on the
cover. Inside he talks about all he’s doing to clean up his firm,
even as we learned earlier that Komansky and Tyco’s Dennis
Kozlowski had once engineered the firing of a Merrill analyst
whom Kozlowski didn’t like. It’s enough to make you sick.
Of course this week we had Kozlowski escaping immediate jail
time once again, unfortunate since a lot of us would like to see
him treated like Ned Beatty in “Deliverance,” but hopefully that
day will still come.
Meanwhile, the investigation into the chicanery at Qwest and
Global Crossing is just heating up, as other inquiries into Xerox
(its third) and Healthsouth emerged, while we also learned that
Enron’s Andrew Fastow will finally receive his first criminal
complaint this coming week.
I could go on and on, but one other thing bears repeating.
This is NOT just about a few bad apples. They haven’t even
really begun to touch Wall Street, while throughout Corporate
America, vast numbers raped shareholders and employees alike.
It’s a memory that will last for years and years. It’s also not a
great backdrop for a new bull market.
Street Bytes
–It was another crushing week for the major averages, the 5th-
straight decline, as an earlier rally fizzled in a hail of sell orders
on Friday. The Dow Jones lost 3.6% to 7701, the lowest level in
4 years, while Nasdaq finished the week at 1199, its worst mark
since September 1996.
–U.S. Treasury Yields
6-mo. 1.56% 2-yr. 1.80% 10-yr. 3.67% 30-yr. 4.68%
The 10-year hit a new all-time low of 3.65% earlier in the week.
–According to the Investment Company Institute and the
Securities Industry Association, half of all U.S. households own
stocks, either directly or through stock mutual funds and
retirement plans. A spokesperson for the ICI said, “What we see
is the stability in holding onto equities.” What I see is carnage.
Separately, another survey has some startling, and depressing,
findings. Only 28% of American adults have saved $50,000 or
more. An astounding 60% have less than $25,000. [Source:
Business Week / Maritz Research]
–Pension plan asset levels continue to plummet, an issue we’ve
long discussed, which is another huge negative for Corporate
America and its shareholders. But the problem also extends to
the states and municipalities, as well, so I note that here in New
Jersey, the state employee plan has lost 27% of its value in the
past two years (and it has bonds, of course), so the governor is
scrambling to find out what happened. Obviously, further
layoffs will be the result, as well as potentially higher taxes, and
this exercise is being repeated all across the country. Not a good
thing if you’re looking for that elusive recovery.
–Energy: OPEC opted not to raise production, but while the
cartel awaits the consequences of military action in Iraq before it
moves to stabilize the market in the event of supply disruptions,
the fact is existing inventories continue to fall, right in the face of
the winter heating season. As for energy stocks, they began to
rally just as I touched ground back in the good old U.S., for
which I am eternally grateful. [I haven’t made a change to my
own portfolio in weeks, and remain about 77% cash, 20%
energy, and 3% Turkey (depreciation here).]
–Japan: Officials claimed to be finally doing something about
the banking problem, but we’ve seen this game all too often in
the past so we expect little real change. But when it comes to the
‘deflation’ side of the equation, the nation’s core CPI fell for a
35th consecutive month. Since World War II, no industrialized
nation has seen 3 years in a row of falling prices. Which is
perhaps a good lead in to this week’s installment of…
–Deflation / Inflation Watch: Mark R., desperately trying to
ensure future employment at StocksandNews, is playing both
sides of the fence. Olives are up 13%, chopped chili peppers 8%
(Mark makes a mean dip), but used car prices are plummeting (a
2002 Bonneville with 17,000 miles was recently purchased by
Stan N. for $14,000, while the sticker price, new, is over
$30,000). Meanwhile, Titleist Pro V1 golf balls have fallen from
$45 to $41 a dozen. Last week I played with range balls in
Ireland, while my playing partners spent hours looking for each
$4 ball they lost. [Actually, they had a ‘lost ball’ bet riding on it,
so I was reasonably understanding.]
–Philip Morris slashed its earnings forecast on the back of lower
sales for its cigarettes. [They must not be including my friend
J.P.’s consumption in Ireland…but then he was undoubtedly
unnerved by my driving…yet no one was hurt!] I’m reminded
with MO, however, that over the past few months I have placed a
number of stocks on my personal “watch list,” Philip Morris
being one of them. Since this was a change for me to go even
this far, just know that MO, Taiwan Semiconductor and
Continental Airlines merely remain on the list and I am no nearer
to an actual purchase than I was before. In the case of
Continental, an airline I love to fly, it would be pure idiocy to
buy any airline stock before the war in Iraq. It doesn’t take a
rocket scientist to understand that any fear of flying won’t abate
until the situation (with its terrorist aspects) clears up some.
–The outlook for once mighty telecom equipment giants, Nortel
and Lucent, just gets worse. Aside from the aforementioned
news from SBC, Nortel now says third quarter revenues will be
15% below just the last quarter’s, while shares in Lucent are now
trading at $0.77.
But I have to add with regards to Lucent that when I drove past
its headquarters the other day, I couldn’t help but notice the
lawn. If you were stranded on a desert island since March 2000,
all you’d need to know is the shape of this massive expanse, once
a showpiece (going back 35 years to the old Bell Labs days).
Today, it’s a wasteland. So I now include this as part of the
Peter Lynch school of investing. Start checking the grass.
–I said I didn’t care about Martha Stewart, but, for the record,
with a Merrill Lynch aide having flipped, it would appear Ms.
Doily will soon be offered a plea bargain.
–I must say I’m amused by the stories of an imminent settlement
between Citigroup and the government (including New York
State and Eliot Spitzer). First off, remember, this doesn’t help
Sandy Weill et al when it comes to all the lawsuits that will keep
bubbling to the surface, but what cracks me up is one potential
solution being bandied about, whereby Citigroup forms two sets
of research; one for institutions and the other for the little guy
(retail).
Analyst #1 to Institution X: “I’d sell Citigroup. It’s an accident
waiting to happen. Just like J.P. Morgan.”
Analyst #2 to Joe Six-Pack: “Hey, at $30, you’d be a moron not
to buy Citigroup! Look at the franchise!”
*There will be far more on the possible settlement next week and
it will undoubtedly impact the whole brokerage community.
–Two weeks ago, Barron’s ran a story touting the market’s
performance in pre-presidential election years, more specifically,
how historically there has been a 51% average gain in the S&P
from the mid-term election year low to the pre-election year
high. [Ned Davis Research] This is the kind of ludicrous
garbage that does a disservice to those practicing prudent
financial planning. Like it’s all that easy picking both a bottom
and a top. Jerks. Now if you just want to talk returns for the full
calendar year, that’s a different story, and one I’ll write up in a
future “Wall St. History” piece.
–Good to see Tony Soprano recommending bonds the other day.
He must be reading my comments on PIMCO and the Total
Return Fund.
–Then there is Gateway, the gang that couldn’t shoot straight.
Have you heard one of their new commercials, employing Gary
Glitter’s “Rock and Roll Part 2”? Back in 1999, Glitter was
brought up on charges of child pornography. I guess it’s okay to
use this common anthem at sporting events, but it’s not exactly
the corporate image I’d want to portray. Just my opinion…I
could be wrong.
–Glancing through Friday’s Wall Street Journal, I note the
following statistics from Lipper Associates.
5-year annualized returns ending 9/26.
Large-cap growth funds: -3.3%
Large-cap value: -1.5%
Small-cap growth: -3.5%
Small-cap value: +2.5%
International (non-U.S.): -4.1%
Intermediate investment grade bonds: +6.6%
High yield (junk) bonds: -2.4%
Short-term bonds: +5.8%
S&P 500 (including dividends): -0.7%
What does it all mean, aside from the obvious fact that you
would have been better in quality bonds? Not much, I guess,
particularly in terms of picking individual categories, unless you
were just sticking with, say, small-cap value for this whole
period.
But on a somewhat related basis, what has always irked me to no
end are the disciples of equity investing in general, who all these
years just kept pounding the table, pounding the table…stocks
for the long run and all that bullshit, totally irrespective of
fundamentals. It’s also why I refuse to blame most individuals,
who were crying for reliable assistance in developing a financial
plan (as opposed to those who were just plain greedy). They
sought aid and were taken to the cleaners. It’s just another
reason why we have to clean up Wall Street, once and for all,
from the top down. Bring me their heads.
–With one day to go in the quarter, the S&P 500 has declined a
sickening 16% (989 to 827), this after a 13.7% drop in the
second quarter.
–The Wall Street Journal is raising its subscription rate 8%,
which is a travesty considering they aren’t bringing back daily
‘hi’s’ and ‘lo’s’ on stocks. But you can get it on the Net, they
say (as does Barron’s). Well, if I wanted it all off the Net,
why the hell would I buy the damn paper? [Paid for by “The
Society to Bring Back Daily Hi’s and Lo’s in Paper Format.”]
The Bush Doctrine
President Bush unveiled his Administration’s official national
security strategy (most presidents do this), a document he has
been working on with Condoleezza Rice for about a year now. It
is another monumental statement of policy, a la Bush’s summer
address at West Point. Basically, it crystallizes the issue of good
vs. evil in this painfully uncertain world.
“American is now threatened less by conquering states than by
failing ones.”
“We cannot let our enemies strike first.”
“The enemy is not a single political regime or person or
ideology. The enemy is terrorism.”
Opponents are pointing to the issue of preemption, of course, and
there is no doubt you can have multiple discussions over a few
pints as to what the Bush strategy implies when it comes to
conflicts like between Russia and Georgia, India and Pakistan,
China and Taiwan, and Israel vs. its neighbors. But the policy of
preemption has been part of world history, forever, so it’s really
nothing new. What the President has done, though, is state
clearly that at least under this presidency, we are king of the hill
and, if threatened, you are toast.
It’s the right policy, especially if key allies are constantly kept in
the loop, but it also recognizes the new reality, that no matter
how powerful and ‘right’ we may be, it still only takes a canister
of sarin gas or a nuke sitting in a cargo ship to do incredible
harm. It’s what keeps your editor up at night, always with one
eye open.
International Affairs
Israel:
Dear Prime Minister Sharon:
No one of sane mind is asking your nation to just take one
suicide bombing after another without fighting back, and,
personally, I’m far from upset over the latest treatment of Yassir
Arafat. But, again, do just one thing for the U.S. and the West.
Stop the settlements!
With the latest reports that Hezbollah continues to mass more
rockets in southern Lebanon (thanks to the support of Syria and
Iran), let alone the coming battle in Iraq, with Baghdad’s almost
certain retaliation against your nation, you need all the friends
you can muster.
President Bush, in his national security strategy document, calls
on you to stop the illegal settlement activity, yet you continue to
flip us off, your only true supporters.
The Palestinian people may be on the verge of throwing out the
corrupt regime that has held them down all these decades. Do
the right thing, Mr. Prime Minister, though I doubt you have the
guts to.
Sincerely,
Brian Trumbore
–Germany: No doubt, Chancellor Schroder’s election victory
was an ugly one, gained at the expense of the U.S. But I’ll leave
the shrill commentary for others. The German people will soon
see the error of their ways, while I, for one, will simply start
reading product labels more closely and for the first time will
consciously boycott German goods.
As for President Bush’s reaction in not calling Schroder to
congratulate him, I concur. The President has far bigger
problems on his hand, like lining up France and Russia for the
Security Council resolution, for starters, while at the same time
preparing our nation for war. And to my friends who have often
shared my own anti-French rhetoric, know that President Chirac
is not happy with Schroder either. Be patient with Jacques, at
least for now, and maybe an earlier statement of mine, following
Chirac’s own reelection, will come true. That being he will rise
to the occasion. If I prove to be wrong, I’ll admit it.
[Germany did just get a spot on the Security Council for 2003,
but the key resolution(s) the U.S. needs should be wrapped up
long before they have a chance to create mischief.]
–North Korea: There have been some authentic positive
developments on this front. Two weeks ago, the Commies
reached agreement with South Korea to reconnect rail and road
links between the two, while Japanese Prime Minister Koizumi’s
historic trip to Pyongyang has done the U.S. a huge favor. Thus,
by week’s end, the Bush Administration announced it was
sending a special envoy to the North in October for wide-ranging
talks. Importantly, at least for now, this helps U.S. relations with
both Seoul and Tokyo at a time when the two vital allies have
been wondering about President Bush’s commitment to the
region.
Latin America: And then there is this basket case. It’s so easy to
forget what’s going on down here these days, but suffice it to
say, the situation certainly isn’t getting any better. Argentina and
Venezuela are still in the grips of 16%+ unemployment, with the
latter’s political crisis verging on renewed chaos, while Brazil’s
critical election is but one week away, October 6. Former union
leader Luiz da Silva has a shot at outright victory (according to
the latest poll I read). This ain’t good, sports fans.
Northern Ireland: The power sharing agreement is seriously
unraveling and it will all come to a head around New Year’s.
Austria: Just a follow-up to my comment from 9/14 that Jorg
Haider had regained control of his Freedom Party. No sooner
did I write this then he stepped down once again, which means
that he is finally officially irrelevant.
Random Musings
–New Jersey Senator Robert Torricelli may have received a
death sentence for his campaign, as federal prosecutors finally
released details concerning the testimony and relationship
between Torch and his former friend, David Chang. Chang, for
his part, was all over the airwaves in an interview from prison.
His long-held story that he gave Torricelli $150,000 worth of
gifts is now backed by the prosecutors’ file. I said long ago that
despite his problems, Torch would still pull it off. Mr.
Chairman, I’d like to revise and extend my remarks…
–The NYSE has been working on plans to build a 2nd trading
floor, far from Wall Street, in the event of a “nuclear” incident.
The basement would be able to house personnel for days. Trust
me, if a large-scale nuclear device goes off in New York,
keeping markets opened will be the least of the citizenry’s
worries, even those living in Nebraska. Nonetheless, it’s a step
that has to be taken.
–A survey of Australians shows that 7 out of 10 support military
action in Iraq, just another reason why I love these people
(except Greg Norman, as you’re about to find out). And I’m
coming to see you all early in 2003, so start stocking extra beer
in the pubs of Sydney!
–At my club in Lahinch (County Clare, Ireland), the pro shop
proudly displays photos of all the professional golfers who stop
by and it’s something the locals eat up. So I heard this week that
Greg Norman was a total asshole when he played a round there
recently, refusing to have his picture taken for just such a
purpose. Meanwhile, Phil Mickelson and others gladly did so.
[As an aside, the locals say Mark Calcavecchia could easily be
mayor. They love him here.]
I bring this up because in my business career, whatever
reputation I had I’d like to think was achieved as a result of
doing ‘the little things.’ Long after e-mail was introduced, I was
still doing handwritten notes to my counterparts and I know they
appreciated it (something I picked up from Bush #41, to tell you
the truth). For his part, Greg Norman is thus a failure.
But Norman is also a failure as a golf architect, sports fans.
Some of you have undoubtedly heard of his new course at
Doonbeg in Ireland (between Lahinch and Ballybunion). Well,
I’m here to tell you…don’t believe the hype! It is vastly
overrated. And as one of my friends said last week, before we
even played it, “Boy, I hope Norman didn’t blow another one.”
Alas, he had. He took the last great links land left in the country
and screwed it up.
Finally, on this theme, not only is Lahinch an even better test
than previously (due to extensive changes), Ballybunion is better
than ever. Also, the town of Ballybunion is worth exploring for
a few nights. I’ve done this before, but now finally appreciate
the charm of the place. In other words, I had a blast!
[Stay at Mike’s place…the Marine Hotel.]
Oops, I got carried away and almost missed the point of this
story. In keeping with doing the little things, President Bush
should have made a public statement of gratitude to the French
soldiers who helped rescue the American students in the Ivory
Coast. Believe me, it would have gone a long way in France.
Basically, it was a layup.
–As you know, I have never been a Jesse Ventura fan but I don’t
disagree with his stance on Cuba and lifting of the embargo; it’s
been a joke.
–Back to Ireland, the country continues to boom, and with each
trip I rue the day I didn’t buy a little place there ten years ago.
–Weekly attendance at mass in the Republic of Ireland has
plummeted further and is now just 48%.
–The other day, Afghanistan’s Hamid Karzai said that the focus
on redeveloping his nation should be on 3 simple things:
highways, electricity and water. You’ll recall that a long time
ago I said the policy of the West in helping the developing world
should be predicated solely on roads and clean water, from which
all else flows. Of course I bring this up as an excuse to once
again slam the policies of Clinton/Gore, who always touted PCs
for the destitute of Africa and elsewhere. Quite amazing, really.
–The Census Bureau reported on the growing gap between the
rich and poor in America, with 11.7% of the people now living in
poverty, way too many for comfort. As for the rich, if you aren’t
taking some of your wealth and at least trying to make a real
difference in your community and with your fellowman, as
opposed to just having college buildings or art centers named
after you, then you are not only a dirtball, you’re beneath
contempt.
–An extensive study in Britain reveals that up to 6,600 may have
the human form of mad cow disease, a far greater number than
initially estimated. So with this in mind, one of my buddies
insisted we eat a hamburger in Ireland this week. “It was great
the first time I had one,” he said, as Marty and I succumbed to
temptation…and promptly got ill. [Nothing permanent, we
assured each other.]
–India witnessed further ethnic violence as a few Muslims
stormed a Hindu temple and killed 30. In quaffing a few pints
with my friends, we had a little discussion on the topic of racial
and ethnic violence, particularly as it pertained to the U.S. One
of my pet peeves is when I hear those from other countries
slamming America for its perceived problems in this arena. Of
course this couldn’t be further from the truth. Any issues we
have are absolutely infinitesimal compared to Muslims vs.
Hindus, Hutsis vs. Tutsis, Shiites vs. Sunnis, and all the other
combinations you can think of.
–In November, NATO will be extending invitations to Bulgaria,
Estonia, Latvia, Lithuania, Romania, Slovakia, and Slovenia.
Some say the organization is holding its nose when it comes to
Bulgaria and Romania. Welcome them, friends. Over time they
will be valuable members, certainly better than Germany!
–One-third of Saudis of working age are unemployed. Sounds
like new leadership is needed, eh? Prince Bandar al-American
has a nice ring to it.
God bless the men and women of our armed forces.
God bless America.
—
Gold closed at $321 [Same as 9/20]
Oil, $30.54 [$29.61 on 9/20]
Returns for the week, 9/16-9/20
Dow Jones –3.9% [7986]
S&P 500 -5.0%
S&P MidCap -5.3%
Russell 2000 -5.8%
Nasdaq -5.4% [1221]
Returns for the week, 9/23-9/27
Dow Jones -3.6% [7701]
S&P 500 -2.1%
S&P MidCap -0.9%
Russell 2000 -1.5%
Nasdaq -1.8% [1199]
Returns for the period, 1/1/02-9/27/02
Dow Jones -23.2%
S&P 500 -27.9%
S&P MidCap -19.1%
Russell 2000 -25.9%
Nasdaq -38.5%
Bulls 41.9% [9/20]…42.2% [9/27]
Bears 30.1% [9/20]…34.5% [9/27]
[Source: Investors Intelligence]
Have a great week. I appreciate your support.
Brian Trumbore
